LONDON Aug 14 Russian stocks rose on Thursday
as investors hoped for an improvement in relations between
Russia and Ukraine, while central European currencies were
steady after mixed growth data.
Russian President Vladimir Putin said in a speech in Crimea
that Russians needed to mobilise for benefit of their country,
but not for conflict with outside world.
Investors have been concerned over the delivery of Russian
aid to eastern Ukraine. A senior official of the International
Committee of the Red Cross (ICRC) was travelling to Kiev and
Moscow on Thursday for talks, saying the delivery of aid "should
not be politicised".
Meanwhile, the leader of pro-Russian rebels in Ukraine's
Luhansk region announced his resignation, becoming the second
senior rebel to quit in the space of seven days.
Russian stocks rose 0.6 percent and the rouble
Ukraine's hryvnia, which has been hitting record
lows, fell more than 1 percent.
Investors are once more becoming worried about the
sustainability of Ukraine's debt, with five-year credit default
swaps approaching the 1,000-bp level that indicates distressed
debt, according to data from Markit.
The MSCI emerging equities index was stable having
hit its highest level in nearly two weeks in the previous
Emerging sovereign debt spreads edged out by 1 basis
point to 315 bp over U.S. Treasuries.
The forint was stable after data showing stronger
than expected growth in Hungary in the second quarter, with the
leu and the zloty also flat after weaker
than expected Q2 GDP data for Romania and in-line data for
Investors are anxious about the outlook for central Europe
due to the impact of Western and Russian tit-for-tat sanctions.
"We don't expect the recovery in central and eastern Europe
to go into reverse over the coming months and quarters, but
growth is likely to remain slower than the rates seen at the
start of this year," analysts at Capital Economics said in a
The Turkish lira weakened 0.25 percent after data
showing Turkey's current account deficit widened in June to
The shekel rose a quarter of a percent as a renewed
truce in Gaza between Israel and Hamas appeared to be holding.
Shares in Qatar's Mesaieed Petrochemical surged in
heavy trade after MSCI said it had added the stock to its MSCI
All-Country World Index.
Mesaieed's shares jumped as much as 10 percent - their daily
limit - in early trade. Qatari stocks hit two-month highs
before trimming gains.
Egyptian stocks edged up to fresh six-year highs,
helped by expectations of more Gulf aid for Egypt.
For GRAPHIC on emerging market FX performance 2014, see link.reuters.com/jus35t
For GRAPHIC on MSCI emerging index performance 2014, see link.reuters.com/weh36s
For GRAPHIC on MSCI emerging Europe performance 2014, see link.reuters.com/jun28s
For GRAPHIC on MSCI frontier index performance 2014, see link.reuters.com/zyh97s
For CENTRAL EUROPE market report, see
For TURKISH market report, see
For RUSSIAN market report, see )
(Editing by Kevin Liffey)